The government is under pressure to use millions of pounds of money returned by BT to boost rural broadband provision.

BT was given a £1.2 billion subsidy to help fund its rollout of 24Mbps broadband across Britain.

Nearly one in three homes have signed up for fast broadband, far more than the amount that had originally been calculated and used to determine the size of the subsidy.

BT has therefore chosen to return £258 million to the government, which has prompted calls for this money to be used to improve broadband connectivity in rural locations.

Jon Trickett, the Shadow Communities Secretary, told the Telegraph: "This spare £258 million returned to the Treasury by BT could make all the difference in connecting up the most hard to reach areas.

“Ensuring access to high speed broadband is one of the best ways in a modern economy for a government to helps boost the prospects of small businesses and entrepreneurs."

Furthermore, he argued that improving broadband connectivity would give households in the countryside the same access to public services as everybody else.

Former Conservative Party Chairman Grant Shapps, meanwhile, called for the money to be reinvested in rolling out fast broadband "as quickly as possible".

"It is not only the right thing to do, but it has essentially already been pledged to meet this high speed goal," he commented.

Mark Hawthorne, chairman of the People and Places Board at the Local Government Association, added that councils are very keen to reinvest this "windfall" to ensure homes and businesses benefit to the full.

Last year, the government said it wants to implement a new broadband Universal Service Obligation (USO) that ensures everyone in Britain is able to access minimum speeds of 10Mbps by 2020.

However, this week it was confirmed in a consultation document on the USO that broadband will not be an automatic right in hard-to-reach locations, due to the expense, which means premises in rural areas will have to request connections.

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